Dryland corn next 'insurance' crop?

Delta Farm Press has recently fielded calls from Arkansas farmers concerned about “insurance dryland corn.” The fear these farmers cite is that their irrigated corn crops will pay a heavy price if aflatoxin shows up in dryland corn.

“There are some farmers around here that have bought dryland corn insurance. I’m not sure who or what the signup numbers are,” says an Extension agent in east Arkansas.

“There’s a lot of dryland corn planted in the U.S., just not a lot in the South. The program is there and available. Farmers are in dire straits, markets aren’t looking too spiffy, and this program may offer some kind of help. Everything is bleak in the ag world and you can understand why some farmers are taking the insurance,” says the agent.

Steve Roddery, an Extension agent in Marion in Crittenden County, says his area hasn’t had a lot of dryland corn lately. “But in the early 1990s, we had some guys growing it and getting 110 to 120-plus bushel crops. It is risky, though, and the threat of aflatoxin is certainly higher if you aren’t irrigating. That’s a concern and once it’s known that affected corn is coming out of a certain area, the situation snowballs.”

“If you look at budgets, I’m sure you can certainly cut expenses drastically by growing corn dryland. Theoretically, you can plant some Roundup Ready corn, spray it once and call it a day. But that just isn’t a good idea.

“In 1998, what dryland corn we had was totally destroyed by aflatoxin. In turn, that destroyed the marketing capacity of all the irrigated corn. Once aflatoxin is found, it’s just assumed that the entire corn crop in an area, regardless of how it was grown, is tainted.

“In 1998, a lot of people got into corn production that didn’t understand the implications of aflatoxin. We kept telling farmers that aflatoxin was serious and potentially devastating,” says Johnson.

If a grower plants good, southern hybrids – hybrids that have good ear tip coverage – that he manages well, then aflatoxin is a minor problem, says Johnson. But if a grower plants corn dryland and doesn’t manage it intensively, the crop is “infinitely” more likely to fail.

“Corn is like a pretty girl: if you don’t take care of her, she’ll leave you,” says Johnson.

Insurance farming isn’t as big a deal when you’re talking about soybeans or cotton, says Johnson.

“Farmers who aren’t just after insurance may get upset, but they know it’s not going to affect them – at least short term. But when it comes to corn, if you have a crop that’s aflatoxin tainted, the radar goes up at the elevators and everyone gets sucked in. I’ve gotten calls from farmers worried about this. They’re not really worried about neighboring farmers getting insurance money. They’re worried about what this means for their crop’s marketing potential.”

How much dryland corn is going in? Johnson is hearing everything from just a few fields of corn to thousands and thousands of acres.

“I certainly hope it’s on just a few acres. What’s good about this is it’s made some people think about the possibilities. Hopefully this will head off any problems. We don’t want to get to the place where no one will take Arkansas or Delta corn. The potential is serious. I speak with Arkansas farmers regularly who tell me how corn has helped keep them in business. I hear that all the time. We don’t want that to go away,” says Johnson.

A Delta-based economist says there are solid reasons to keep an eye on the situation.

“If you give the buyers a justification to hammer prices, they’ll take it. The farmers planning to grow a legitimate crop could have a legitimate beef here. We’ll have to wait and see,” says the economist.